Investors chase bargains, Sensex gets a 311-point lift

Mumbai, September 3

A strong push for value-buying coupled with upbeat global cues today made sure the benchmark BSE Sensex ended the day in the positive zone after three straight days of losses, which jumped 311 points to close at 25,764.78.

Even the NSE Nifty notched up gains. The smart recovery was mostly a result of investors going on a bargain-hunting spree in beaten-down stocks owing to attractive valuations.

Also, investors got some positive feelers from the US following an impressive overnight jump in Wall Street stocks.

What came as a reprieve was Chinese markets, which have been seen instrumental in triggering the recent global stock rout, were shut for a long weekend, which calmed nerves.

The domestic front provided more ammunition. There were expectations that lower-than-expected GDP growth, subdued inflation and mixed PMI numbers will offer RBI more elbowroom to slash rates at its upcoming policy review on September 29, which lifted investors' spirits.

The 30-share Sensex shot up to a high of 25,835.41 before closing at 25,764.78, up 311.22 points, or 1.22 per cent.

As many as 27 stocks ended higher. The NSE Nifty reclaimed the 7,800-mark by adding 106 points, or 1.37 per cent, to close at 7,823. Intra-day, it scaled a high of 7,845.60.

"On the back of global cues, the domestic markets today opened and remained in positive territory throughout the day. All eyes are on the European markets ahead of the ECB policy meeting," said Alex Mathews, Head Research, Geojit BNP Paribas Financial Services.

Investors were also enthused after CBDT today issued a circular asking its fields officers to keep on hold pending assessments and not to recover any outstanding.

In the Sensex team, Tata Steel took the lead, gaining 4.55 per cent, followed by Vedanta as metal prices hardened.

All the domestic sectoral indices were back in the green with gains up to 4.55 per cent.

Mid- and small-cap indices too trended higher, gaining up to 1.18 per cent.

Japan's Nikkei after a spell of losses in previous sessions closed the day 0.48 per cent higher. European markets too ruled firm.

Meanwhile, IMF has said in a research paper on global growth prospects published on Wednesday that near-term growth prospects remain favourable for India and the country's external vulnerabilities have decreased.

Investors are still playing safe ahead of the US payrolls data due this week.

Veracity Group CEO Pramit Brahmbhatt said, "Price sensitive stocks and blue-chips gained on value-buying and short-covering."

The market breadth turned positive as 1,719 stocks advanced, 969 stocks slipped while 133 ruled steady. The total turnover fell to nearly Rs 2,361 crore, from Rs 2,596.85 crore yesterday.

On market outlook, Vinod Nair, Head-Fundamental Research, Geojit BNP Paribas Financial Services said: "All eyes are on today's ECB meet and there are expectations of further expansion in quantitative easing. The global market was under pressure from the slowdown in China and the prospects of a US rate hike on September 17. The market will be in a trading range depending on the outcome of the Fed meet." — PTI